Nokia will receive billions of dollars from Microsoft for adopting the Windows Phone platform on future smartphones, as the two companies struggle to compete with Apple and Google in the mobile space.

According to The Associated Press, Nokia Chief Executive Stephen Elop revealed at this week's Mobile World Congress that Microsoft is paying the Finnish handset maker billions of dollars to switch to Windows Phone. Elop revealed the agreement in an effort to appease investors, after his company's stock tumbled 14 percent following the announced partnership with Microsoft.

The CEO said Microsoft's payments acknowledge the "substantial value to contribute" that Nokia offers the Redmond, Wash., software giant. He also said that his company will pay Microsoft royalties for the use of its software, as is standard practice.

Elop was also asked if he's a "Trojan horse" for Microsoft, his former employer, to which he replied "No." He said the decision to adopt the Windows Phone platform was unanimous among Nokia's senior management.

Nokia announced last week that it plans to ditch its Symbian operating system for future smartphones and will instead focus on creating new handsets running Microsoft's Windows Phone platform. Through the partnership, in which the two will "integrate key assets," the companies said they plan to introduce a "new global mobile ecosystem" by jointly creating new mobile products and services.

Nokia went on to reveal on Monday it plans to release its first handsets running the Windows Phone platform this year. Elop said that his company is "feeling the heat" to meet a 2011 deadline.

Elop, previously the head of Microsoft's Business Division, took over as CEO of Nokia in September of 2010. Nokia has struggled to maintain its dominance in the smartphone market as competitors Apple and Google have found great success.

Elop candidly acknowledged those struggles in a 1,300-word letter to employees issued this month. In it, he compared the company's Symbian mobile operating system to a "burning platform" that the company was forced to jump off of in order to survive.

Apparently when you leave your job at microsoft you have a big "MORON" tattooed to your forehead as you have no real clue how to run a non-monopoly business. Why in the world would you announce this joint effort to the world up to a year before you can actually implement it in new devices, and before you've had time to effectively prepare/ transition your huge installed user base? Nothing says "abandon my brand" like "I'm going to dump the OS you are now using, because it has no future and I sold you crap, and we will not have something new to replace it for you for the next 12 months or so!"

This is why Apple has such tight security on info leaks on new products et al. (Remember the intel switch that went so smoothly after it wasn't announced until products were actually ready for sale.) It is a competitive advantage to keep secrets and protect the existing business - sell what you have. Now all loyal Nokia users have been told / given permission to look for something else that is better because what they are using has no future. And that something new and better most certainly won't be MSFT/Nokia handsets. ROFLOL at this one.

Apparently when you leave your job at microsoft you have a big "MORON" tattooed to your forehead as you have no real clue how to run a non-monopoly business. Why in the world would you announce this joint effort to the world up to a year before you can actually implement it in new devices, and before you've had time to effectively prepare/ transition your huge installed user base? Nothing says "abandon my brand" like "I'm going to dump the OS you are now using, because it has no future and I sold you crap, and we will not have something new to replace it for you for the next 12 months or so!"

This is why Apple has such tight security on info leaks on new products et al. (Remember the intel switch that went so smoothly after it wasn't announced until products were actually ready for sale.) It is a competitive advantage to keep secrets and protect the existing business - sell what you have. Now all loyal Nokia users have been told / given permission to look for something else that is better because what they are using has no future. And that something new and better most certainly won't be MSFT/Nokia handsets. ROFLOL at this one.

I love this. It is an excellent point. The head of Nokia has basically told everyone thinking of buying a Nokia phone not to buy a Nokia phone because they run a rubbish OS. Nice one Elop. I am really looking forward to this going totally wrong.

I love this. It is an excellent point. The head of Nokia has basically told everyone thinking of buying a Nokia phone not to buy a Nokia phone because they run a rubbish OS. Nice one Elop. I am really looking forward to this going totally wrong.

Yes, qand they are saying: we are going to fire all our enginneers, that know nothing about microsoft technologies, because they are crap too.

I love this. It is an excellent point. The head of Nokia has basically told everyone thinking of buying a Nokia phone not to buy a Nokia phone because they run a rubbish OS. Nice one Elop. I am really looking forward to this going totally wrong.

Its simple. Nokia dropping Symbian for a symbiotic relationship with MS. This is best chance both of them have for getting a stable ground in smartphones. Elop is doing what Jobs did when he came back to Apple. Apple had a rubbish OS, too, and they admitted it.

This is Nokias best move. WP7 is a good modern mobile OS. Nokia has HW knowledge but no SW chops so even if they choose Android, they couldnt pull off a Nokia-esque UI or a vetted app store. They couldnt even make it the best Android phone on the market since that will require driver knowledge which they havent shown to possess. So what other options did they have besides going down the same miserable path and not admitting that need to make changes?

That's an unprofessional title but given then really snippy twitters those guys really are pissed...and tweeting that way. So far we have "two turkeys do not make an eagle" and a "Any Nokia software engineers need a job? We're hiring".

This appears to be as good a deal for Nokia as it is for MS. MS intended to spend $$$ promoting WP7 and I guess part of that billions in value will be toward subsidizing Nokia ads or pushing Nokia. Then the huge discounts in software licenses essentially makes WP7 as free as Android for Nokia.

Buying Palm would have been the better move but given that Apple probably put in a relatively high bid I'm guessing HP paid too much. But going WP7 looks like as good a secondary option as is left.

Going linux IMHO really screwed them. Samsung's BSD/proprietary based Bada is far more likely to be successful given they can keep what they want proprietary as opposed to give all their competitors a leg up like with MeeGo/Maemo. If you need to tie other layers to the kernel tightly then GPL forces you to open all that stuff up too (sorta). By not going Linux Samsung can open source what they want but keep the key stuff internal.

This story has already been corrected in the press. The actual story is that Nokia will save billions by adopting Windows Phone.

No. You're mis-represnting it here yourself.

Money will flow both ways. MS will pay Nokia for the use of Ovni maps, Nokia will pay MS for the licenses for Windows Phone 7. Microsoft has also committed to offsetting the costs of development and any short term losses over the two years or so it will take to pick up speed.

Remember Nokia is basically throwing away a world-wide, world-leading business here to take a bet on Microsoft. There is a very real danger that Nokia could go under as a company before it has time to develop any market for Windows Phones. That alone means that Microsoft is on the hook for billions due to it's promise to keep Nokia afloat and in the game while it switches over.

If he is a Muslim from Kenya then why hell did the CIA. allow him into the white house? Oh and by the way Muslims are part of the federal reserve homey. So you better chill. Remember you ain't on the gold standard anymore.
Troll.

Quote:

Originally Posted by zindako

Typical white male racist rhetoric, what are you afraid you're no longer at the top of the food chain, scared a black man can become president and has the intellectual aptitude that is superior to your peers? I bet you neve questioned bush nativity to thos country, oh let me guess. There was no such thing as native Americans, it was all made up and caucasions are the real natives of this land, I mean, you were all non immigrants and everyone else is not worthy of being called an American.

And since when is the Islamic faith illegal here in the united states of America that has freedom of religion and several liberties engrained into it's history and philosophy.

Quote:

Originally Posted by Logisticaldron

This is why we need a sarcasm tag for modern textbased discourse. Im pretty damn sure Superbass was being ironic.

Quote:

Originally Posted by steelraven

Or better yet Bush was the real terrorist to America

Quote:

Originally Posted by zindako

We don't need crap lines like that from superbass, the media already broadcast that junk from fox news everyday all day. I'm sure he truly believes that nonsense at the core of his being.

I want all of you guys, and everyone else for that matter, to cut this out right now, or I'll remove all of your posts here. Is that understood?

Its simple. Nokia dropping Symbian for a symbiotic relationship with MS. This is best chance both of them have for getting a stable ground in smartphones. Elop is doing what Jobs did when he came back to Apple. Apple had a rubbish OS, too, and they admitted it.

This is Nokias best move. WP7 is a good modern mobile OS. Nokia has HW knowledge but no SW chops so even if they choose Android, they couldnt pull off a Nokia-esque UI or a vetted app store. They couldnt even make it the best Android phone on the market since that will require driver knowledge which they havent shown to possess. So what other options did they have besides going down the same miserable path and not admitting that need to make changes?

If they can corner a market the way they did with Windows, Office, and more recently, Xbox, it is very well worth it. I would rather bet on Apple's model of savvy business moves and an uncanny feel for the future of technology, but if you don't have those skills and your greatest asset is nearly limitless amounts of money, what else are they supposed to do?

... That alone means that Microsoft is on the hook for billions due to it's promise to keep Nokia afloat and in the game while it switches over.

I'm not at all. Please listen to what Elop actually said, rather than to second-hand rumours.

Quote:

Originally Posted by The Register

A wire report claiming that "Microsoft is paying Nokia billions of dollars to switch to Windows Phone 7" is equally ill-founded.

What Elop actually said was that the "net benefit" of the strategy changes he announced would ultimately save Nokia billions. "The value transferred to Nokia is measured in billions not millions," he said.

Value, not cash. If even The Register can get its facts right, anyone can.

A fool and his money are lucky to find each other in the first place. Microsoft is proving this every day with the type of poor business decisions that they are making. Are they thinking that they can somehow save Nokia by offering up an OS that hasn't done that great to begin with? Another anchor on that sinking ship is not going to provide any additional buoyancy.

Elop was also asked if he's a "Trojan horse" for Microsoft, his former employer, to which he replied "No." He said the decision to adopt the Windows Phone platform was unanimous among Nokia's senior management.

Hm, any developer with some pride would rather pay for sex, than for somebody to use his software...

What is the value of something like Ovi Maps? A service nobody wanted to pay for, so in the end Nokia was giving it away for free in most countries.

Elop should be careful about throwing these huge numbers around... Nokia has enough enemies in the EU (since they collected a lot of subsidies for creating jobs in several countries, and then moved factories away) and MS is under constant watch anyhow... There is certainly more than one regulator (or competition watchdog) who would like to make this deal more difficult.

This deal seems to make good business sense for both Nokia and Microsoft. Nokia gets a modern smartphone OS while Microsoft gets the distribution of the world's largest mobile handset manufacturer. Seems like a win/win to me. Guess time will tell and both companies will no doubt be hedging their bets.

It will be interesting to see what happens now that HP has re-entered the fray. In my opinion, there are only three platforms that can successfully make money. The contenders are Apple, Google, Microsoft, and HP...

Certain people didn't notice the admonishment to stop the political talk, all the political posts are being turfed to Political Outsider. Next time, sarcasm or not, joke or not, please leave the politics out unless it is actually on topic to the article.

If they can corner a market the way they did with Windows, Office, and more recently, Xbox, it is very well worth it. I would rather bet on Apple's model of savvy business moves and an uncanny feel for the future of technology, but if you don't have those skills and your greatest asset is nearly limitless amounts of money, what else are they supposed to do?

Just because I laugh doesn't mean I think it's a terrible thing!

As an APPL investor I actually want MS & Nokia to succeed as I feel they'll erode more Android market share than iOS.

On top of that, I kind of think the Windows phones look cool in their own right whereas Android phones look like a cheap version of iOS. Best of luck to MS!

I keep reading this Nokia deal is going to put Microsoft into the #2 smartphone os position. So basically, this means everyone who owns a Symbian based Nokia smartphone is going to buy a crap Nokia Windows Phone.

Windows Phone has been out in Europe and the a lot of the rest of the world for quite some time and no one is buying it. Why would people suddenly buy a Windows Phone just because it is from Nokia? It makes no sense based on the facts.

My guess is, very few people will be buying Nokia smart phones from this point on; Symbian is a dead end. Window Phone is a failure today and is not going to magically become popular because the new cloner phone says Nokia on it.

Apple and Android as so far ahead at this point there is no catching up. Nokia signed a deal with the devil and will die because of it, like all Microsoft "partners" do. Elop is clearly a trojan horse in the hostile take over of Nokia by Microsoft. Elop is already bringing in more softies as i write this.

Good software devs can move from platform to platform without a lot of heartache. It's part of the profession.

Sure. And i suppose you hire a lot of 10 years of expereince Unix/Linux/MacOSX expert to work on your .net project, right ?

Of course you can, and of course they can become eventually very productive, but you wouldn't hire them.

But this is not really the point; the point is that you worked 10 years on an OS kernel whose primary goal (originally) was to keep away Microsoft from the telephone market (and it succed quite well in this). Today your boss come and says: everything you have done was crap, we married microsoft, we will use their solutions, not yours.

You just pissed off 10 thousands engineers, you made their experience useless, their mission null; you just froze their motivation. This is a recipe for failure, the failure that come when you ignore the company culture.
Microsoft still need those engineers to make products.

Windows Phone has been out in Europe and the a lot of the rest of the world for quite some time and no one is buying it. Why would people suddenly buy a Windows Phone just because it is from Nokia? It makes no sense based on the facts.

Apple and Android as so far ahead at this point there is no catching up. Nokia signed a deal with the devil and will die because of it, like all Microsoft "partners" do. Elop is clearly a trojan horse in the hostile take over of Nokia by Microsoft. Elop is already bringing in more softies as i write this.

I think it's premature to write-off Windows phone and to say that iOS and Android are cemented success. MS and Nokia are huge companies that won't leave this market laying down.

Who cares if Elop is a Trojan horse. Let's see how this all plays out!

See Note at bottom of my text to explain the heading... (but please read what I am saying about the deal first!)

The Microsoft - Nokia deal may be "worth" a number measured in the 'B's but this includes summing up all of the cross licencing arrangements, and the reduction of overheads through developer layoffs at Nokia. Then there are joint marketing campaigns as someone already said, but actual cash transfers are probably minimal compared to the loss of revenue in at least the short term.

However, this deal is clearly heavily weighted in Microsoft's favour. They get two years worth of exposure as a "main provider" and market share on the back of Nokia's failing glory. At the end of that time, they don't really care what happens to "Know-Kyer" as Ballmer calls them so intelligently (it's 'o' as 'o' is in 'box' in case you don't know). By then half the idiots in the world will have been blasted with so many adverts telling them that MS powers the market leader in mobile phones that they will buy them on anything and forget Android.

(I used some irony in that paragraph - I didn't think Ballmer said anything intelligent at all, just in case you, dear reader, jump to any conclusions).

As for Nokia, they get Elop. They give up their software division, Symbian, and independence. They lose market share hand over fist - first because Elop has dissed his own phones, and secondly because WM7 is so bad that when they launch phones with it on few will buy them.

Elop is clearly making the mistake that he thinks the whole world loves Microsoft as much as do Microsoft employees! He must have had quite a culture shock when reality bit him on the bum and instead of Nokia's stock price rising 25% it FELL the same amount! ROFLMAO! I just feel sorry for anyone at Nokia right now. But I bet Finnish and other large European pension funds are selling Nokia shares now hand over fist as we speak...

Note:
Doesn't anyone read before posting these days? It's one knee jerk reaction after another. A few people need to look up irony in the dictionary - the OP was comparing the latest most ridiculous thing he had ever heard of with the last most ridiculous thing he had ever heard of. In other words, he didn't believe either ridiculous thing, he just used one to illustrate the other along the lines of "he's as fast as light" "as loud as a bomb" "as thoughtless as a knee jerk reaction" and so on. Come one, this is supposed to be a place where clever people bring their intelligence with them!

Gotta announce it. They need at least 6 months to a year to get everyone moving in a new direction.

At least they already have WP7 prototypes. They actually look pretty nice. I like the colors and they look metallic so I'm hoping they have good build quality.

Are these prototypes or just renderings?

this early announcement is stupid no matter how you look at it. This essentially killed the Symbian market, which although in decline, was not dead. At the same time, WP7 is not a guarantee for success. So they created a situation where they killed/will kill any revenue stream related to Symbian, need to wait at least half year to a year before new revenue stream can begin, with no guarantee the new stream will be there anyway.

If Symbian was already just hanging on by a thread, and Nokia gasping for air, announcing this would have made sense to offer a future vision. But this is not needed at the moment. They could have worked on WP7 in secret until relatively close to shipping the product, thus giving themselves at least a chance to capture some of the customers jumping the Symbian ship.

Since Microsoft is willing, and able, to spend money on this mobile phone business, how about just sending letters to every iphone and android user, saying they will give us a windows phone and pay for the two year contract? that might actually be cheaper and would give them positive results, so to speak. Microsoft is kind of like the affirmative action of phones: no merit, but quotas.

They have to announce it. Investors are worried. They want to know what Nokia is doing to stop the bleeding. Nokia can't just smile and say, "Trust us." They have to give solid plans to reassure the investors.

Money will flow both ways. MS will pay Nokia for the use of Ovni maps, Nokia will pay MS for the licenses for Windows Phone 7. Microsoft has also committed to offsetting the costs of development and any short term losses over the two years or so it will take to pick up speed.

Remember Nokia is basically throwing away a world-wide, world-leading business here to take a bet on Microsoft. There is a very real danger that Nokia could go under as a company before it has time to develop any market for Windows Phones. That alone means that Microsoft is on the hook for billions due to it's promise to keep Nokia afloat and in the game while it switches over.

The best thing they could do RIGHT NOW is put the Nokia brand on all new MS phones. "Nokia - powered by WP7" "WP7 inside" (with apologies to Intel), or some such marketing nonsense. Customers around the world may not even be aware of the MS tie-in, and Nokia gets to continue some semblance of cash-flow until the total integration takes place. It's my feeling that most of the world could care less about software - they just want a phone that works in their neighborhood, for a reasonable cost related to their income.

That is not true. At the time, in many ways it beat just about any version of Windows. Apple's OS, however, was old. It didn't represent a good foundation to build from. For instance, going to OSx allowed Apple to easily port the processor to both Power PCs and Intel processors. That would have been a nightmare to try to do with the old OS.

Watching MS is like watching a very large trainwreck in ultraslow motion. It's taking years to to die but I can't look away because to see Steve Balmer face plant into a big pile of dog poop is really satisfying. I just feel sorry for all the underlings that he is taking with him.